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Only 16% of the Web Is Clicking Display Ads
Brett_Tabke




msg:3999471
 8:12 pm on Oct 1, 2009 (gmt 0)

[izurl.com...]

The number of people online who click display ads has dropped 50% in less than two years, and only 8% of internet users account for 85% of all clicks, according to the most recent "Natural Born Clickers" study from ComScore and media agency Starcom. As the pool of people who click on banner ads rapidly decreases, it begs the question: Is the long-used click-through rate now officially useless?

Clickers only represent 16% of U.S. internet users, according to ComScore data from March. The study initially found that 32% clicked on display advertising in July 2007. If that first study, released last year, crystallized skepticism that click-through rates weren't the be-all end-all success metric for display, this most recent report might just be the last nail in the digital coffin.


 

hutcheson




msg:3999478
 8:33 pm on Oct 1, 2009 (gmt 0)

It would be interesting to compare this figure to the number of people who'd buy drugs from e-msil spammers.

caribguy




msg:3999481
 8:50 pm on Oct 1, 2009 (gmt 0)

Initial disbelief when reading
[..] a low number of clicks doesn't necessarily mean banners don't work, but that marketers are looking at the wrong success metrics

Never admit defeat ;)

But this part intrigues me:
consumers exposed to a display ad were more likely to visit the advertiser's site than users who never saw the ad

How can we measure this residual effect?

Edit/Added:
1st comment seems spot on:
companies doing Internet studies can study themselves out of business if they don't say something positive

weeks




msg:3999482
 8:55 pm on Oct 1, 2009 (gmt 0)

It would be interesting to compare this figure to the number of people who'd buy drugs from e-msil spammers.

Funny. Number of idiots on the web...

Those of us from the print side of the biz are not surprised at this. The vast majority of advertising has NEVER worked this way: "Oooo, look! I must buy/find out more NOW."

This is why many people thought Google, in the early days, would fail. They didn't realize that in the context of search, people were looking to "buy/find out more."

Most web sites, however...not so much. I worked in news for a while and learned quickly that people are not looking to buy Valentine's Day candy when reading about zoning for a new shopping center.

BUT, later, when they buy candy for Valentine's Day (as many will do), they might remember this retailer or that brand of candy. We do know this: With no advertising, they won't remember either the retailer or the brand because they never knew it to forget it. THAT'S how advertising works. And that is how ALL webmasters deserve to be paid--on impressions.

[edited by: weeks at 9:07 pm (utc) on Oct. 1, 2009]

woop01




msg:3999484
 9:01 pm on Oct 1, 2009 (gmt 0)

How can we measure this residual effect?

That question struck me like a ton of bricks as a sign that the web has come full circle.

inbound




msg:3999500
 9:33 pm on Oct 1, 2009 (gmt 0)

Banners are for Branding :: Search is for Sales

The ability to measure immediate response rates for banners does not change the way our brains work, and hence the way we are influenced by advertising - if a lack of clicks on banners was a huge issue then billboards, magazine, newspaper and TV advertising would have died out before we had to worry about banner CTRs.

Branding is VERY important and always will be; it often allows companies to sell similar products at premium prices.

The problem for publishers when it comes to CPM rates is the size of available inventory (there's much more than advertisers/agencies want to pay decent CPMs for). The best CPM rates tend to go to people who have a more recognisable brand because there are secondary effects. If you sold motor products and had banners on the website of a very well known and trusted motor website, do you think that would be better for your image (and hence long term sales) than some random site about motors?

Remember, building a brand is not about getting a single spontaneous purchase - it's about training people to think of your brand every time they want that type of item. Advertising is the only way for the mundane to achieve that, and it's getting more difficult (the outstanding can build brands by word of mouth in the same way Google did).

There are tiers when it comes to display, and unfortunately most people do not have the brand or the traffic for advertisers to discover the true value of the space on offer - so we'll always have a gulf between the true worth of advertising space on many smaller sites and the amount earned - conversely, it's often the case that too much is paid on the well know sites for ads - that's just the way the cookie crumbles.

Unfortunately for most people, we have to accept that the agencies that spend the budgets of big clients live in a different world from us (and so do the people that they have to impress).

physics




msg:3999513
 10:00 pm on Oct 1, 2009 (gmt 0)

It would be interesting to do a case study on a company who ONLY ever advertised using web display ads. Would you see the 'branding' effect that advertisers are so willing to pay for in print magazines?

Something that always has amazed me is why Coca-Cola, for example, doesn't make an agreement with Google and buy up ALL of the un-targeted display ads on sites running Google AdSense. Don't get me wrong, I like the idea of public service ads because they help worthy causes - but it's amazing to me that a company interested in branding (Coke, Toyota, Starbucks, McDonalds...) wouldn't be chomping at the bit for some cheap impressions like that, and that Google wouldn't be happy to oblige, and of course webmasters wouldn't be happy to get the cash for impressions on these ads through some sort of agreement but we have little say in the matter after all ;)

JS_Harris




msg:3999515
 10:10 pm on Oct 1, 2009 (gmt 0)

Death of the ad click... blasphemy!

That's like saying a swine flu vaccine is important.

I'm getting more clicks, and earning more from them, so its a sweet death anyway. I've also heard that humanity survived for millions and millions of years without this new, ultra expensive, vaccine.

Can we really trust no-one these days?

caribguy




msg:3999523
 10:22 pm on Oct 1, 2009 (gmt 0)

chomping at the bit for some cheap impressions

1. it cheapens the advertiser's brand
2. it cannibalizes the ad network's premium inventory
3. how 'distressed' is that low end inventory (pages now showing ad council) really - e.g. lowering the page quality bar even further
4. there is no limit as to the amount of additional space that can and will be created if a webmaster can earn even as little as an additional $.005 CPM ;)

buckworks




msg:3999534
 11:14 pm on Oct 1, 2009 (gmt 0)

Good banners can be about branding AND sales.

Banners which are well designed and well placed can do quite all right in terms of direct sales.

I just checked September's stats for some AdWords banner campaigns that the client intends to expand. One set of banners which featured a specific product had a CTR of .55% and a conversion rate of 1.88% for September. That's lower than the conversion for search (text) ads for the same product but higher than for text ads on the content network. It's quite worthwhile to run the banners for direct sales; increased brand awareness is almost a bonus.

We take a more granular approach than just circulating generic banners about our "widgets". We have banners about widget couplers to target pages that are relevant to widget couplers; banners about widget intensifiers to target pages that are relevant to widget intensifiers, and so on.

We do run generic widget banners, of course, but we try to balance our campaigns so that if a page is relevant to a specific widget the individual product banner would get precedence.

We've estimated that perhaps 1 in 200 people would be in need of our widgets in any particular year, so it behooves us to target carefully. A "plaster banners everywhere" approach would likely be an ineffective use of resources.

zeus




msg:3999541
 11:26 pm on Oct 1, 2009 (gmt 0)

Banners are for Branding - Yes thats also my thought, but I will also say this, if a banner content is very close to site content, it will be clicked. A site about Honda cbr1000 and a banner that shows the new suzuki which the user knows is very quick will click the banner.

explorador




msg:3999550
 11:44 pm on Oct 1, 2009 (gmt 0)

Proportions...

I think years ago it required more power to have a website and-or to buy ad spaces. Sure there was a lot of spam and trash around but I think the proportion these days is way bigger.

Perhaps these days, the amount of times an user clicks on a banner only to find a spammy landing page is bigger?

Brett_Tabke




msg:3999552
 11:50 pm on Oct 1, 2009 (gmt 0)

What I want to see, is the percentage of surfers who still don't know that adwords or adsense are ads. About 5 years ago, it was still as high as 70%.

inbound




msg:3999557
 11:57 pm on Oct 1, 2009 (gmt 0)

Buckworks and Zeus are indeed correct - well placed banners can work for sales (and well done to Buckworks for the impressive numbers) - but the real problem is that most people (with the majority of the big budgets) simply can't or won't take the ultra targeted approach that works. There are also some branding campaigns that wouldn't be able to get enogh ultra targeted impressions, so there will always be people wanting to do campaigns for branding on sites that don't measure up well for selling.

So although there are many exceptions, for the average publisher and advertiser banners are (currently) for branding - but I do hope that will change in favour of better targeting that pays publishers well.

incrediBILL




msg:3999576
 1:05 am on Oct 2, 2009 (gmt 0)

When it comes to banners and other graphics ads I'd believe them, miserable CTR.

When it comes to AdSense, my stats are holding strong.

weeks




msg:3999598
 2:02 am on Oct 2, 2009 (gmt 0)

Banners which are well designed and well placed can do quite all right in terms of direct sales. ...

Buckworth's points above cannot be stressed enough. I'd only add that well designed banners on quality sites (quality audience and quality editorial) work especially well.

James_WV




msg:3999884
 1:01 pm on Oct 2, 2009 (gmt 0)

>>But this part intrigues me:
>>consumers exposed to a display ad were more likely to visit >>the advertiser's site than users who never saw the ad

>>How can we measure this residual effect?

Met with a Google account optimizer a couple of weeks ago, by the end of the year Google should be brining out a report which measures views through to conversions

nomis5




msg:4000064
 5:44 pm on Oct 2, 2009 (gmt 0)

I'm staggered that 16% admit to clicking the ads. I bet it's even higher than that in reality. With reasonably good blending I think about half of users don't even realise they are clicking an ad.

I personally have never clicked on a single in my life. If I want something I google it or go to amazon direct.

poppyrich




msg:4000102
 6:43 pm on Oct 2, 2009 (gmt 0)

I've oftened wondered if user behavior, like scrolling or mouse movement, was an indication of anything.
I tend to move the mouse away from whatever area I'm reading (that is, paying attention to) - but this of course has much to do with the design of the page.

Gomvents




msg:4001487
 3:35 pm on Oct 5, 2009 (gmt 0)

my CTR on my display ads have gone down slightly, but conversion rate is through the roof. Further they still seem to be very effective for branding despite many who claim "they never click banner or pay attention to them" - our research shows otherwise.

Baruch Menachem




msg:4002108
 2:02 pm on Oct 6, 2009 (gmt 0)

It is also an issue of the kind of banners we are seeing today today. The banners I am seeing are for things like teeth whitening, education scams, acia berries, date sites, etc.
As someone mentioned up topic, what matters is the the brand impression you make. I am getting very low band impression on banner ads these days.
and if you sell ads to a low quality advertiser, it lowers the trust folks would have in your site.
I have seen one site that has maintained very high click through, but the owner only takes ad for products he trust, the ads have the name of the company in the ad and the product is relevant to his users.
I think the google adsense ad is going to murder click through, as lots of the google ad sense ads are exactly wrong for a site. On a couple occasions, I have seen google adsense ads that were offensive to visitors on a site I no longer go to.

mcneely




msg:4006546
 9:36 pm on Oct 13, 2009 (gmt 0)

Perhaps these days, the amount of times an user clicks on a banner only to find a spammy landing page is bigger?

Indeed .. not only just bigger .. it's huge.

Anyone with money can put on an ad these days .. and it sorely shows.

skibum




msg:4010330
 8:54 pm on Oct 20, 2009 (gmt 0)

consumers exposed to a display ad were more likely to visit the advertiser's site than users who never saw the ad

They always trumpet this stat but they never address the issue that a ton of banner campaigns are behaviorally targeted, sometimes called "lead back". This means ads are only shown to people who have already been to the website. So going along these lines for these types of programs you could also say that people who previously visited an advertiserís site are more likely to visit that advertisers site again. Then the question becomes does the banner have anything to do with it or would the person have gone to the site anyway? I've never seen any study that addresses this, ever.

The ability to measure immediate response rates for banners does not change the way our brains work, and hence the way we are influenced by advertising - if a lack of clicks on banners was a huge issue then billboards, magazine, newspaper and TV advertising would have died out before we had to worry about banner CTRs.

I'd agree to a point, but and it's a big BUT, is it reasonable to say that our brains are operating differently when we are browsing the web than viewing ads in ANY/EVERY other medium?

When you read a newspaper or magazine, it tends to be in a more relaxed state of mind, when you watch TV you tend to be vegging out in a relaxed state of mind, when you are driving down the highway and look at a billboard there are not a lot of distractions if the road is relatively clear.

When you go online, you usually go there for a purpose to do something, to achieve something. You probably have multiple windows open, you are more likely to be sitting on the edge of your seat, and your heart rate might even be elevated a bit compared to reading a book or watching a mellow TV program. You are trying to be more focused and yet you have a lot more distractions so intuitively, I would think you pay a lot less attention to advertising unless it is what you are looking for. Since banner campaigns really can't judge or target intent and people are more focused on searching and scanning, I think the branding effect of banners is highly questionable. There have been many brands built on search or search/affiliate but is there even one that was built (even in large part) on banner ads? Videos maybe (think BlendTec), but not banners and probably not rich media either.

There is so much money and there are so many vested interests in claiming banners work but nobody ever tries to prove they don't. There is always some new study that says even though nobody clicks on them, they are a great branding tool and maybe they are but the assumptions and the targeting behind the campaigns need to factor into these studies to make them hold water IMHO.

Let's see a big ad network or ad serving company run a large campaign for a big merchant. Target it however you want but serve the actual banners 50% of the time and just set a cookie as if people have been exposed to the banners the other 50% of the time. Compare those two pools and see what the results show. Chances are the will be very different based on the targeting options and may show that some targeting options work and some don't.

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